In Illinois v. City of Milwaukee, the Supreme Court was concerned with whether state or federal courts should fashion the common law of pollution. Considering the important federal interest involved, it is not surprising the Court chose to lodge that responsibility in the federal courts. Here, however, the same concern is not present. The issue before the Court is whether this action will be adjudicated in the Court of Claims or in a federal district court. Both are federal courts. There is no question of state versus federal interests. The Court of Claims, which specializes in federal contract law, is just as competent to fashion and construe the federal common law of contracts as are federal district courts. In this context, the Court does not believe Illinois v. City of Milwaukee should be read to authorize federal question jurisdiction in district courts when Congress has provided that the Court of Claims should exercise exclusive jurisdiction. We therefore hold there is no federal question jurisdiction in the instant action on the basis of federal common law. But see Ghent v. Lynn, 392 F. Supp. 879, 881-82 (D. Conn. 1975).
The plaintiff cites the recent decision in Trans-Bay Eng'rs & Bldrs. v. Hills, 179 U.S. App. D.C. 184, 551 F.2d 370 (1976), as supportive of its contention that federal question jurisdiction lies here. A close analysis of that decision, however, reveals that federal question jurisdiction was found there because the plaintiff's claim was founded upon "equitable rights generated by HUD's course of activities pursuant to federal statutes." 551 F.2d at 377. The Court distinguished Lindy v. Lynn, 501 F.2d 1367 (3d Cir. 1974), where the complaint was dismissed for want of jurisdiction, on the ground that Lindy involved only the interpretation of contract rights.
This action, like Lindy, involves only contract rights. It is therefore not within the rule of Trans-Bay. The fact that Lindy involved the application of Pennsylvania contract law, 501 F.2d at 1369, while this action involves the application of the federal common law of contracts, makes no difference, in our opinion, because of the distinctive statutory policy that actions of this kind be adjudicated in the Court of Claims. See S. Rep. No. 1894, 86th Cong., 2d Sess. 3 (1960).
B. The National Housing Act as the basis for Federal Question or Commerce and Monopolies Jurisdiction.
Plaintiff alleges that federal question and commerce and monopolies jurisdiction lie because the action arises under the National Housing Act, a statute regulating commerce.
The cases make it clear, however, that in order for an action to "arise under" a federal law, that law must be a "direct element" in the plaintiff's claim, or there must be a need for determining the meaning or application of such a law. 13 Wright, Miller & Cooper, Federal Practice and Procedure: Jurisdiction § 3562, at 411-13 (1975). The action at bar, however, does not involve the National Housing Act as a "direct element." There is no need to construe or apply the Act. The Act does not provide the substantive right and remedy, even though it waives sovereign immunity with respect to the transaction at issue. Therefore, the action does not "arise under" the Act. Lindy v. Lynn, 501 F.2d 1367, 1369 (3d Cir. 1974).
This is a simple case sounding in contract. Congress established the Court of Claims to determine claims of this kind and magnitude. It is hard to conceive of a claim falling within the Court of Claims' exclusive jurisdiction that could not be urged to confer federal question, or even commerce and monopolies or diversity, jurisdiction if plaintiff's arguments were to prevail, assuming a waiver of sovereign immunity. It would virtually "destroy the Court of Claims by implication." See International Eng'r Co. v. Richardson, 167 U.S. App. D.C. 396, 512 F.2d 573, 578 (1975), cert. denied, 423 U.S. 1048, 96 S. Ct. 774, 46 L. Ed. 2d 636 (1976); Warner v. Cox, 487 F.2d 1301, 1306 (5th Cir. 1974). The legislative history of the Tucker Act shows that Congress intended the Court of Claims to have exclusive jurisdiction over claims of this kind. See S. Rep. No. 1894, 86th Cong., 2d Sess. 3 (1960). Since this Act is a specific grant of jurisdiction, it takes precedence over general jurisdictional statutes such as 28 U.S.C. §§ 1331, 1332, and 1337. We therefore distinguish Trans-Bay on the basis that that case did not involve only questions of contract law and regulations, as this one does, and was not clearly within the exclusive jurisdiction of the Court of Claims.
We conclude that this case is within the exclusive jurisdiction of the Court of Claims. Upon reaching such a conclusion, the Court has two options. It may exercise its discretion under 28 U.S.C. § 1406(c) and transfer this action to that court, where it will proceed as if it had been filed on the date it was filed in this Court, or it may dismiss the action. Counsel for plaintiff has advised us that it would prefer a dismissal, which would allow an immediate appeal. We will therefore enter an order dismissing for want of jurisdiction.
In this disposition, we do not reach the merits of plaintiff's contractual claim as to which defendants have asserted the possibly substantial defense that no contract ever in fact existed because the plaintiff's offer was never accepted.
John H. Pratt United States District Judge
[EDITOR'S NOTE: The following court-provided text does not appear at this cite in 436 F. Supp.]
Upon consideration of defendants' motion to dismiss for want of jurisdiction and the motions of all parties for summary judgment, in accordance with the accompanying Memorandum Opinion, it is this 30th day of August 1977,
ORDERED that defendants' motion to dismiss is granted; and
ORDERED that the motions for summary judgment are denied as moot; and
ORDERED that this case is dismissed without prejudice to plaintiff's right to file it in the Court of Claims.
John H. Pratt United States District Judge